Filed 2/25/22 Emerson v. Los Angeles County Employees etc. CA2/1

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION ONE

APPEAL from a judgment of the Superior Court of Los Angeles County, James C. Chalfant, Judge. Affirmed.

Peter Borenstein for Plaintiffs and Appellants.

Steven P. Rice and Michael D. Herrera for Defendant and Respondent.

________________________

By virtue of her former employment by Los Angeles County (County) as an emergency room nurse and, later, hospital administrator, Charla Toedt was a member of the Los Angeles County Employees Retirement Association (LACERA). She accrued nearly 30 years of service and planned to retire on June 26, 2019.

On May 6, 2019, Toedt finalized her retirement arrangements with LACERA, at which time she appeared to be in good health and expected to receive a monthly retirement income of more than $5,000 for the rest of her life. Toedt chose the maximum income stream for herself and did not name any beneficiaries. In fact, the plan in which she had participated for her entire career, Plan E, limits eligible beneficiaries to a surviving spouse, domestic partner, or minor children, and Toedt had no such beneficiaries.

On May 30, 2019, Toedt suffered a catastrophic stroke and became incapacitated.

On June 19, 2019, Toedt’s longtime friend and roommate, petitioner Bruce Emerson, contacted LACERA in the capacity of Toedt’s attorney-in-fact, citing a springing power of attorney (POA) which he had held on Toedt’s behalf since 2011, and attempted to amend her retirement plan to add Toedt’s sisters, petitioners Sarah Erickson, Mary Tate, and Jane Osumi (Toedt’s sisters, or the Toedt sisters) as beneficiaries.

On June 30, 2019, Toedt passed away after a short time in hospice.

When LACERA later refused to honor Emerson’s request to add the Toedt sisters as beneficiaries (collectively, Emerson or appellants), he and they filed a petition for a writ of mandate. Following a bench trial, the court ruled in favor of LACERA.

Appellants urge error in the trial court’s refusal to extend the holding of Schubert v. Reynolds (2002) 95 Cal.App.4th 100 (Schubert), which discusses circumstances under which a power of attorney can add or change beneficiaries to a public retirement plan, as well as the trial court’s erroneous reliance upon an inadmissible hearsay declaration in reaching its judgment.

Although the trial judge and the parties thoroughly explored whether the holding in Schubert aids Emerson, we need not reach this issue because appellants’ fundamental contention is that LACERA wrongfully refused to permit Emerson to change Toedt’s pension plan from Option 1 to Option 4 of Plan E. Option 4 of Plan E, identically to Option 1, limits eligible beneficiaries to a surviving spouse, domestic partner, or minor children. Toedt’s sisters are not among this class. As a result, regardless of Emerson’s powers to choose among options within Plan E, he has not demonstrated error because there is no path by which Toedt’s sisters would be eligible to obtain a continuing benefit.

Because it was inartfully and belatedly raised in the trial court, we also reject appellants’ hearsay objection to the entirety of the declaration submitted by John Popowich, assistant executive officer for LACERA. However, as did the trial court, we will exclude from our consideration any substantive discussions regarding oral counseling Toedt may have received from LACERA staff.

Accordingly, we affirm.

FACTUAL AND PROCEDURAL BACKGROUND

LACERA is a public retirement system created and governed by the County Employees Retirement Law of 1937 (Gov. Code, § 31450 et seq.) to provide retirement, disability and death benefits for eligible County employees. LACERA is a public entity legally separate and distinct from the County. (See Traub v. Board of Retirement (1983) 34 Cal.3d 793, 798-799.) The Board of Retirement of LACERA is charged with, among other things, administering the retirement system for eligible County employees. (Gov. Code, §§ 31520.1, 31520.5.)

LACERA administers several defined-benefit retirement plans, colloquially known as “Plan A” through “Plan G.” Every plan except Plan E—the plan in which Toedt was enrolled—is a “contributory” plan. Plan E members, on the other hand, do not make contributions: the payment of Plan E benefits is financed entirely by County contributions and the earnings of its retirement fund. Because Plan E members do not pay monthly contributions, Plan E benefits are lower than under the contributory retirement plans administered by LACERA.

Toedt was employed by the County from April 1992 until June 2019. By virtue of Toedt’s employment with the County, she was a member of LACERA. (Gov. Code, § 31552). Toedt participated in Plan E throughout her employment.

On October 31, 2018, April 24, 2019, and May 6, 2019, Toedt visited LACERA member services center for retirement counseling. During these counseling sessions, Toedt received retirement benefit estimates, discussed highest final average compensation, retirement benefit options, medical subsidy, healthcare plans, beneficiary designations and more.

During the April 24, 2019 counseling session, Toedt submitted a beneficiary designation form naming the Charla R. Toedt Trust (Trust) as beneficiary to receive a $5,000 lump sum “death/burial benefit.” On this same day, a beneficiary confirmation letter was printed and mailed by LACERA to Toedt.[1]

The Confirmation Notice letter has two columns: one entitled “% of Death Benefit,” the other entitled “% of Retiree Burial Benefit.” The number “100” is printed under both headings. In narrative form below these figures is printed: “The $5,000 Death/Burial Benefit is paid only if the member dies after retirement.” This Confirmation Notice nowhere discusses the beneficiary of any “continuing benefit,” i.e., a claim to a portion of a stream of income payable to a qualifying beneficiary following Toedt’s death.

At the time of Toedt’s retirement, Plan E included six retirement options. These options affect the amount of the member’s monthly retirement allowance during their lifetime, as well as the amount of continuing benefits payable to a spouse, domestic partner, or minor child upon the member’s death. No Plan E option expands the class of eligible beneficiaries to include a “trust” or a decedent’s siblings.

The “Unmodified” option, the option selected by Toedt, provides the full amount of the monthly benefit to which the member is entitled based on the member’s retirement plan, age, years of service, and final compensation. By comparison, the “Unmodified +Plus” option and “Option 1” through “Option 4” are customized benefit options that pay a member a reduced retirement benefit while also providing a fixed percentage or set dollar amount to the same class of eligible beneficiaries, i.e., a surviving spouse, domestic partner, or minor children.

The appellate record contains a handbook for Plan E members entitled, “Summary Plan Description/Retirement Plan E/General Member.” Under the section for “Designating Beneficiaries,” a subsection begins: “Eligible beneficiaries referenced in Plan E Retirement Options are defined on the following pages.” The following pages go on to list a surviving spouse, domestic partner, minor child, or person with an insurable interest.[2]

On May 6, 2019, Toedt again visited LACERA’s member services center to submit retirement documents. She elected a retirement date of June 26, 2019, and again chose the Unmodified option. The appellate record also contains a form, entitled “Retirement Benefit Estimate and Election Form (Counter Application),” stamped “Received[,] May 06, 2019[,] LACERA MEMBER SERVICE CENTER.” Under the column “Beneficiary’s Allowance,” the form is blank.

On June 7, 2019, after Toedt became incapacitated, Emerson visited LACERA’s member services center and submitted the POA, as well as a letter from Toedt’s doctor stating that she was unable to make financial or medical decisions due to her medical condition.

On June 11, 2019, following a legal review of the POA by LACERA’s in-house counsel, staff sent a letter acknowledging approval of Emerson as Toedt’s attorney-in-fact and explaining his limited powers with respect to making amendments to Toedt’s pension agreement with LACERA. This letter stated that Emerson was only authorized to: (1) file an application to retire and requests for estimates; (2) select the unmodified benefit option only; and (3) request to withdraw retirement contributions and interest.

On June 14, 2019, LACERA staff verbally informed Emerson that he was not able to change the member’s retirement option or name any beneficiaries because these actions were not expressly authorized by the POA.

On June 21, 2019, Emerson submitted a request to: (1) rescind Toedt’s retirement date of June 26, 2019; (2) retire Toedt on June 28, 2019; (3) change the retirement option from “Unmodified” to “Option 4”; and (4) add the Toedt sisters as beneficiaries.[3]

On June 30, 2019, Toedt passed away.

On July 5, 2019, LACERA staff verbally informed Emerson that it was rejecting his requests to change Toedt’s retirement option from Unmodified to Option 4 in order to add beneficiaries given the POA’s lack of express authority to make such changes.

On July 10, 2019, LACERA followed-up in writing and confirmed that his requests were rejected because Toedt’s POA does not expressly allow for the attorney-in-fact to “designate” or “change” her plan beneficiaries.

On September 19, 2019, Emerson filed a petition for writ of mandate and complaint for declaratory and injunctive relief. The petition sought a writ of mandate to compel LACERA to retroactively amend Toedt’s retirement plan in order to change from Unmodified to Option 4, and to add the Toedt sisters as beneficiaries.

On October 15, 2020, following a bench trial, the trial court issued a thorough 15-page, single-spaced, ruling in favor of LACERA, concluding that Emerson lacked the power to add or remove beneficiaries to Toedt’s pension under Probate Code section 4264,[4] and that Schubert’s limited exception to section 4264 was inapplicable because Emerson’s POA did itself not expressly confer upon Emerson the authority to create a trust in the first instance.

The trial court also rejected the argument that Toedt’s contract with LACERA should be equitably reformed to include the Toedt sisters as beneficiaries (despite Plan E’s exclusion of such persons) based upon LACERA’s failure to advise Toedt that the Trust was an ineligible beneficiary at the April 24, 2019, counseling session. And it similarly rejected Emerson’s argument that LACERA was unjustly enriched, instead ruling that, by electing the Unmodified option, Toedt received exactly what she had bargained for: the highest personal payout in a LACERA plan that had limited beneficiary options for a continuing benefit.

DISCUSSION

On appeal from a denial of a petition for a writ of mandate, we review the trial court’s factual findings for substantial evidence and its legal conclusions de novo. (McIntyre v. Santa Barbara County Employees’ Retirement System (2001) 91 Cal.App.4th 730, 733-734.)

Appealed judgments and orders are presumed correct, and the appellant has the burden of overcoming this presumption by affirmatively showing error on an adequate record. (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1140-1141; Stasz v. Eisenberg (2010) 190 Cal.App.4th 1032, 1039.) All intendments and presumptions are made to support the judgment or final order on matters as to which the record is silent. (Denham v. Superior Court (1970) 2 Cal.3d 557, 564; Cahill v. San Diego Gas & Electric Co. (2011) 194 Cal.App.4th 939, 956.) Any ambiguity in the record is resolved in favor of the appealed judgment. (Winograd v. American Broadcasting Co. (1998) 68 Cal.App.4th 624, 631.)

“ ‘We affirm the trial court’s decision if it is correct on any ground the parties had an adequate opportunity to address in the trial court, regardless of the reasons the trial court gave.’ [Citation.]” (Wolf v. Weber (2020) 52 Cal.App.5th 406, 410.)

Emerson’s briefing asserts two points of error: (1) that the Schubert exception to section 4264 applies to him, and he thus has the power to select beneficiaries to Toedt’s retirement plan; and (2) the trial court’s reliance on a declaration submitted by Popowich, was reversible error because the declaration is inadmissible hearsay.[5]

It is to be immediately noted that Emerson’s dispute with the trial court over its interpretation of Schubert and section 4264 does not alter the contractual relationships established between Toedt and LACERA. Even were we to rule that Emerson had the power by virtue of his POA to change Toedt’s pension from Unmodified to Option 4 of Plan E, it would not follow that he could also thereby select surviving siblings or a trust as continuing benefit beneficiaries. Put somewhat differently, Emerson’s purported general power to select Toedt’s pension beneficiaries would not confer a right to amend LACERA’s pension agreement with Toedt.

All Plan E options limit eligible beneficiaries to surviving spouses, domestic partners, and minor children. These beneficiary limitations are reflected in the Plan E summary material as well as the May 6, 2019 certificate that was issued following Toedt’s final interaction with the LACERA service center. Both the Plan E summary material as well as the May 6, 2019 certificate reflect Toedt’s knowledge that she had selected a retirement option providing no economic post-death value (excepting the $5,000 lump sum burial benefit) because she had no surviving spouse, domestic partner, or minor children.

Toedt was a Plan E retirement member throughout all her professional life with the County and that she made no retirement contributions out of her own salary and because all non-Plan E plans require salary contributions. Plan E members have six options to select from prior to retirement. The only options at issue in this case are Unmodified and Option 4. Toedt selected Unmodified on at least two occasions and did so in order to receive the highest possible individual post-retirement stream of income. The continuing benefit was limited to a surviving spouse, domestic partner, or minor child and capped at 55 percent of a “member’s allowance” for Unmodified members under the plan documents.

With Toedt critically ill, Emerson attempted to switch Toedt’s pension beneficiaries from Unmodified to Option 4, the latter of which is a “customized benefit option[ ] that pays a member a reduced retirement benefit and provides a fixed percentage or set dollar amount to one or more eligible beneficiaries.” But, as we have said, the eligible Option 4/Plan E beneficiaries are the same: a surviving spouse, domestic partner, or minor children. Moreover, lest there be any confusion about nominating a trust as a Plan E beneficiary, the plan document provides (in a section pertaining to all Plan E options): “If you have a trust and wish to leave a continuing monthly benefit to your spouse, you must designate the spouse as your Primary Beneficiary-100 percent and the trust as Secondary Beneficiary-100 percent. If your spouse or domestic partner dies before you and you have no eligible minor children, unless otherwise designated, the trust will receive a $5,000 lump-sum death/burial benefit. A trust cannot receive a continuing monthly benefit.” (Italics added.)

This limitation prohibiting a trust from receiving a continuing benefit makes sense because, were it otherwise, the LACERA member could easily avoid one of the retirement plan’s fundamental limitations on its survival benefit obligations, viz., only three classes of persons are eligible.

Our independent review of the record on this appeal shows no set of facts under which either Emerson or Toedt could have compelled LACERA to pay her continuing benefit to her sisters—or to anyone for that matter. And if such a pathway does exist, it was incumbent upon Emerson to furnish an adequate record to rebut the presumption that the challenged judgment is correct (Ketchum v. Moses, supra, 24 Cal.4th at pp. 1140-1141; Stasz v. Eisenberg, supra, 190 Cal.App.4th at p. 1039), and to affirmatively demonstrate how the Toedt sisters would be eligible to receive a continuing benefit under any Plan E option. Emerson has not done so, and we cannot speculate in his favor.

Relatedly, reversal of the trial court’s judgment on the POA issue would serve no useful purpose: LACERA would still be entitled to reject Emerson’s beneficiary selection, and the absence of any eligible beneficiaries would revert Toedt’s pension balance to LACERA. Under the circumstances, we will not issue an opinion addressing the hypothetical scope of the POA. (Selby Realty Co. v. City of San Buenaventura (1973) 10 Cal.3d 110, 117; People ex rel. Lynch v. Superior Court (1970) 1 Cal.3d 910, 912.)[6]

DISPOSITION

The judgment is affirmed. The parties shall bear their own costs on appeal.

NOT TO BE PUBLISHED

CRANDALL, J.*

We concur:

CHANEY, J.

BENDIX, Acting P. J.

[1] The record contains a document dated April 24, 2019, discussed post, entitled “Confirmation Notice,” seemingly summarizing the outcome of this meeting.

[2] Emerson’s argument below premised upon the Toedt sisters having had an “insurable interest” in Toedt’s pension has not been made on this appeal, and is therefore forfeited. (Tiernan v. Trustees of Cal. State University & Colleges (1982) 33 Cal.3d 211, 216, fn. 4.)

[3] Erickson and Tate had been previously named as beneficiaries of a revocable trust established by Toedt years prior to her decline.

[4] Subsequent undesignated statutory references are to the Probate Code. Section 4264, entitled “Acts requiring express authorization in power of attorney,” provides that “a power of attorney may perform any of the following acts on behalf of the principal or with the property of the principal only if the power of attorney expressly grants that authority to the attorney-in-fact,” (italics added) and subdivision (f) includes among those powers, the power to “[d]esignate or change the designation of beneficiaries to receive any property, benefit, or contract right on the principal’s death.” (§ 4264, subd. (f).) The Schubert court addressed whether a power of attorney that expressly grants the power to make a trust necessarily includes along with it the power to designate or remove beneficiaries, despite section 4264’s requirement that such a power be expressly designated. (Schubert, supra, 95 Cal.App.4th at pp. 103-104.) It harmonized the power of attorney before it with section 4264, subdivision (d), by holding that the attorney-in-fact was limited to choosing beneficiaries that were already contemplated by the decedent’s estate plan and/or the beneficiaries otherwise eligible under the rules of intestate succession. (Schubert, supra, at pp. 106-107.) The trial court and we agree Schubert is inapposite because unlike the present case—and as Emerson concedes—the POA does not confer upon Emerson the power to create a trust.

[5] Emerson does not take issue with the trial court’s rejection of his contract reformation and unjust enrichment arguments. These arguments are therefore deemed forfeited. (Tiernan v. Trustees of Cal. State University & Colleges, supra, 33 Cal.3d at p. 216, fn. 4)

[6] Emerson’s argument concerning prejudicial admission of the Popowich declaration was belatedly raised in the writ proceeding below and in a perfunctory fashion. Although we could deem the issue forfeited (Sea & Sage Audubon Society, Inc. v. Planning Com. (1983) 34 Cal.3d 412, 417), we note the trial court indicated that “[it] agreed with [Emerson] that the evidence of counseling lacked foundation.” Accordingly, we too will omit any substantive reliance upon the oral counseling Toedt may have received from LACERA staff.

* Judge of the San Luis Obispo County Superior Court, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.

Filed 2/25/22 Emerson v. Los Angeles County Employees etc. CA2/1

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION ONE

APPEAL from a judgment of the Superior Court of Los Angeles County, James C. Chalfant, Judge. Affirmed.

Peter Borenstein for Plaintiffs and Appellants.

Steven P. Rice and Michael D. Herrera for Defendant and Respondent.

________________________

By virtue of her former employment by Los Angeles County (County) as an emergency room nurse and, later, hospital administrator, Charla Toedt was a member of the Los Angeles County Employees Retirement Association (LACERA). She accrued nearly 30 years of service and planned to retire on June 26, 2019.

On May 6, 2019, Toedt finalized her retirement arrangements with LACERA, at which time she appeared to be in good health and expected to receive a monthly retirement income of more than $5,000 for the rest of her life. Toedt chose the maximum income stream for herself and did not name any beneficiaries. In fact, the plan in which she had participated for her entire career, Plan E, limits eligible beneficiaries to a surviving spouse, domestic partner, or minor children, and Toedt had no such beneficiaries.

On May 30, 2019, Toedt suffered a catastrophic stroke and became incapacitated.

On June 19, 2019, Toedt’s longtime friend and roommate, petitioner Bruce Emerson, contacted LACERA in the capacity of Toedt’s attorney-in-fact, citing a springing power of attorney (POA) which he had held on Toedt’s behalf since 2011, and attempted to amend her retirement plan to add Toedt’s sisters, petitioners Sarah Erickson, Mary Tate, and Jane Osumi (Toedt’s sisters, or the Toedt sisters) as beneficiaries.

On June 30, 2019, Toedt passed away after a short time in hospice.

When LACERA later refused to honor Emerson’s request to add the Toedt sisters as beneficiaries (collectively, Emerson or appellants), he and they filed a petition for a writ of mandate. Following a bench trial, the court ruled in favor of LACERA.

Appellants urge error in the trial court’s refusal to extend the holding of Schubert v. Reynolds (2002) 95 Cal.App.4th 100 (Schubert), which discusses circumstances under which a power of attorney can add or change beneficiaries to a public retirement plan, as well as the trial court’s erroneous reliance upon an inadmissible hearsay declaration in reaching its judgment.

Although the trial judge and the parties thoroughly explored whether the holding in Schubert aids Emerson, we need not reach this issue because appellants’ fundamental contention is that LACERA wrongfully refused to permit Emerson to change Toedt’s pension plan from Option 1 to Option 4 of Plan E. Option 4 of Plan E, identically to Option 1, limits eligible beneficiaries to a surviving spouse, domestic partner, or minor children. Toedt’s sisters are not among this class. As a result, regardless of Emerson’s powers to choose among options within Plan E, he has not demonstrated error because there is no path by which Toedt’s sisters would be eligible to obtain a continuing benefit.

Because it was inartfully and belatedly raised in the trial court, we also reject appellants’ hearsay objection to the entirety of the declaration submitted by John Popowich, assistant executive officer for LACERA. However, as did the trial court, we will exclude from our consideration any substantive discussions regarding oral counseling Toedt may have received from LACERA staff.

Accordingly, we affirm.

FACTUAL AND PROCEDURAL BACKGROUND

LACERA is a public retirement system created and governed by the County Employees Retirement Law of 1937 (Gov. Code, § 31450 et seq.) to provide retirement, disability and death benefits for eligible County employees. LACERA is a public entity legally separate and distinct from the County. (See Traub v. Board of Retirement (1983) 34 Cal.3d 793, 798-799.) The Board of Retirement of LACERA is charged with, among other things, administering the retirement system for eligible County employees. (Gov. Code, §§ 31520.1, 31520.5.)

LACERA administers several defined-benefit retirement plans, colloquially known as “Plan A” through “Plan G.” Every plan except Plan E—the plan in which Toedt was enrolled—is a “contributory” plan. Plan E members, on the other hand, do not make contributions: the payment of Plan E benefits is financed entirely by County contributions and the earnings of its retirement fund. Because Plan E members do not pay monthly contributions, Plan E benefits are lower than under the contributory retirement plans administered by LACERA.

Toedt was employed by the County from April 1992 until June 2019. By virtue of Toedt’s employment with the County, she was a member of LACERA. (Gov. Code, § 31552). Toedt participated in Plan E throughout her employment.

On October 31, 2018, April 24, 2019, and May 6, 2019, Toedt visited LACERA member services center for retirement counseling. During these counseling sessions, Toedt received retirement benefit estimates, discussed highest final average compensation, retirement benefit options, medical subsidy, healthcare plans, beneficiary designations and more.

During the April 24, 2019 counseling session, Toedt submitted a beneficiary designation form naming the Charla R. Toedt Trust (Trust) as beneficiary to receive a $5,000 lump sum “death/burial benefit.” On this same day, a beneficiary confirmation letter was printed and mailed by LACERA to Toedt.[1]

The Confirmation Notice letter has two columns: one entitled “% of Death Benefit,” the other entitled “% of Retiree Burial Benefit.” The number “100” is printed under both headings. In narrative form below these figures is printed: “The $5,000 Death/Burial Benefit is paid only if the member dies after retirement.” This Confirmation Notice nowhere discusses the beneficiary of any “continuing benefit,” i.e., a claim to a portion of a stream of income payable to a qualifying beneficiary following Toedt’s death.

At the time of Toedt’s retirement, Plan E included six retirement options. These options affect the amount of the member’s monthly retirement allowance during their lifetime, as well as the amount of continuing benefits payable to a spouse, domestic partner, or minor child upon the member’s death. No Plan E option expands the class of eligible beneficiaries to include a “trust” or a decedent’s siblings.

The “Unmodified” option, the option selected by Toedt, provides the full amount of the monthly benefit to which the member is entitled based on the member’s retirement plan, age, years of service, and final compensation. By comparison, the “Unmodified +Plus” option and “Option 1” through “Option 4” are customized benefit options that pay a member a reduced retirement benefit while also providing a fixed percentage or set dollar amount to the same class of eligible beneficiaries, i.e., a surviving spouse, domestic partner, or minor children.

The appellate record contains a handbook for Plan E members entitled, “Summary Plan Description/Retirement Plan E/General Member.” Under the section for “Designating Beneficiaries,” a subsection begins: “Eligible beneficiaries referenced in Plan E Retirement Options are defined on the following pages.” The following pages go on to list a surviving spouse, domestic partner, minor child, or person with an insurable interest.[2]

On May 6, 2019, Toedt again visited LACERA’s member services center to submit retirement documents. She elected a retirement date of June 26, 2019, and again chose the Unmodified option. The appellate record also contains a form, entitled “Retirement Benefit Estimate and Election Form (Counter Application),” stamped “Received[,] May 06, 2019[,] LACERA MEMBER SERVICE CENTER.” Under the column “Beneficiary’s Allowance,” the form is blank.

On June 7, 2019, after Toedt became incapacitated, Emerson visited LACERA’s member services center and submitted the POA, as well as a letter from Toedt’s doctor stating that she was unable to make financial or medical decisions due to her medical condition.

On June 11, 2019, following a legal review of the POA by LACERA’s in-house counsel, staff sent a letter acknowledging approval of Emerson as Toedt’s attorney-in-fact and explaining his limited powers with respect to making amendments to Toedt’s pension agreement with LACERA. This letter stated that Emerson was only authorized to: (1) file an application to retire and requests for estimates; (2) select the unmodified benefit option only; and (3) request to withdraw retirement contributions and interest.

On June 14, 2019, LACERA staff verbally informed Emerson that he was not able to change the member’s retirement option or name any beneficiaries because these actions were not expressly authorized by the POA.

On June 21, 2019, Emerson submitted a request to: (1) rescind Toedt’s retirement date of June 26, 2019; (2) retire Toedt on June 28, 2019; (3) change the retirement option from “Unmodified” to “Option 4”; and (4) add the Toedt sisters as beneficiaries.[3]

On June 30, 2019, Toedt passed away.

On July 5, 2019, LACERA staff verbally informed Emerson that it was rejecting his requests to change Toedt’s retirement option from Unmodified to Option 4 in order to add beneficiaries given the POA’s lack of express authority to make such changes.

On July 10, 2019, LACERA followed-up in writing and confirmed that his requests were rejected because Toedt’s POA does not expressly allow for the attorney-in-fact to “designate” or “change” her plan beneficiaries.

On September 19, 2019, Emerson filed a petition for writ of mandate and complaint for declaratory and injunctive relief. The petition sought a writ of mandate to compel LACERA to retroactively amend Toedt’s retirement plan in order to change from Unmodified to Option 4, and to add the Toedt sisters as beneficiaries.

On October 15, 2020, following a bench trial, the trial court issued a thorough 15-page, single-spaced, ruling in favor of LACERA, concluding that Emerson lacked the power to add or remove beneficiaries to Toedt’s pension under Probate Code section 4264,[4] and that Schubert’s limited exception to section 4264 was inapplicable because Emerson’s POA did itself not expressly confer upon Emerson the authority to create a trust in the first instance.

The trial court also rejected the argument that Toedt’s contract with LACERA should be equitably reformed to include the Toedt sisters as beneficiaries (despite Plan E’s exclusion of such persons) based upon LACERA’s failure to advise Toedt that the Trust was an ineligible beneficiary at the April 24, 2019, counseling session. And it similarly rejected Emerson’s argument that LACERA was unjustly enriched, instead ruling that, by electing the Unmodified option, Toedt received exactly what she had bargained for: the highest personal payout in a LACERA plan that had limited beneficiary options for a continuing benefit.

DISCUSSION

On appeal from a denial of a petition for a writ of mandate, we review the trial court’s factual findings for substantial evidence and its legal conclusions de novo. (McIntyre v. Santa Barbara County Employees’ Retirement System (2001) 91 Cal.App.4th 730, 733-734.)

Appealed judgments and orders are presumed correct, and the appellant has the burden of overcoming this presumption by affirmatively showing error on an adequate record. (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1140-1141; Stasz v. Eisenberg (2010) 190 Cal.App.4th 1032, 1039.) All intendments and presumptions are made to support the judgment or final order on matters as to which the record is silent. (Denham v. Superior Court (1970) 2 Cal.3d 557, 564; Cahill v. San Diego Gas & Electric Co. (2011) 194 Cal.App.4th 939, 956.) Any ambiguity in the record is resolved in favor of the appealed judgment. (Winograd v. American Broadcasting Co. (1998) 68 Cal.App.4th 624, 631.)

“ ‘We affirm the trial court’s decision if it is correct on any ground the parties had an adequate opportunity to address in the trial court, regardless of the reasons the trial court gave.’ [Citation.]” (Wolf v. Weber (2020) 52 Cal.App.5th 406, 410.)

Emerson’s briefing asserts two points of error: (1) that the Schubert exception to section 4264 applies to him, and he thus has the power to select beneficiaries to Toedt’s retirement plan; and (2) the trial court’s reliance on a declaration submitted by Popowich, was reversible error because the declaration is inadmissible hearsay.[5]

It is to be immediately noted that Emerson’s dispute with the trial court over its interpretation of Schubert and section 4264 does not alter the contractual relationships established between Toedt and LACERA. Even were we to rule that Emerson had the power by virtue of his POA to change Toedt’s pension from Unmodified to Option 4 of Plan E, it would not follow that he could also thereby select surviving siblings or a trust as continuing benefit beneficiaries. Put somewhat differently, Emerson’s purported general power to select Toedt’s pension beneficiaries would not confer a right to amend LACERA’s pension agreement with Toedt.

All Plan E options limit eligible beneficiaries to surviving spouses, domestic partners, and minor children. These beneficiary limitations are reflected in the Plan E summary material as well as the May 6, 2019 certificate that was issued following Toedt’s final interaction with the LACERA service center. Both the Plan E summary material as well as the May 6, 2019 certificate reflect Toedt’s knowledge that she had selected a retirement option providing no economic post-death value (excepting the $5,000 lump sum burial benefit) because she had no surviving spouse, domestic partner, or minor children.

Toedt was a Plan E retirement member throughout all her professional life with the County and that she made no retirement contributions out of her own salary and because all non-Plan E plans require salary contributions. Plan E members have six options to select from prior to retirement. The only options at issue in this case are Unmodified and Option 4. Toedt selected Unmodified on at least two occasions and did so in order to receive the highest possible individual post-retirement stream of income. The continuing benefit was limited to a surviving spouse, domestic partner, or minor child and capped at 55 percent of a “member’s allowance” for Unmodified members under the plan documents.

With Toedt critically ill, Emerson attempted to switch Toedt’s pension beneficiaries from Unmodified to Option 4, the latter of which is a “customized benefit option[ ] that pays a member a reduced retirement benefit and provides a fixed percentage or set dollar amount to one or more eligible beneficiaries.” But, as we have said, the eligible Option 4/Plan E beneficiaries are the same: a surviving spouse, domestic partner, or minor children. Moreover, lest there be any confusion about nominating a trust as a Plan E beneficiary, the plan document provides (in a section pertaining to all Plan E options): “If you have a trust and wish to leave a continuing monthly benefit to your spouse, you must designate the spouse as your Primary Beneficiary-100 percent and the trust as Secondary Beneficiary-100 percent. If your spouse or domestic partner dies before you and you have no eligible minor children, unless otherwise designated, the trust will receive a $5,000 lump-sum death/burial benefit. A trust cannot receive a continuing monthly benefit.” (Italics added.)

This limitation prohibiting a trust from receiving a continuing benefit makes sense because, were it otherwise, the LACERA member could easily avoid one of the retirement plan’s fundamental limitations on its survival benefit obligations, viz., only three classes of persons are eligible.

Our independent review of the record on this appeal shows no set of facts under which either Emerson or Toedt could have compelled LACERA to pay her continuing benefit to her sisters—or to anyone for that matter. And if such a pathway does exist, it was incumbent upon Emerson to furnish an adequate record to rebut the presumption that the challenged judgment is correct (Ketchum v. Moses, supra, 24 Cal.4th at pp. 1140-1141; Stasz v. Eisenberg, supra, 190 Cal.App.4th at p. 1039), and to affirmatively demonstrate how the Toedt sisters would be eligible to receive a continuing benefit under any Plan E option. Emerson has not done so, and we cannot speculate in his favor.

Relatedly, reversal of the trial court’s judgment on the POA issue would serve no useful purpose: LACERA would still be entitled to reject Emerson’s beneficiary selection, and the absence of any eligible beneficiaries would revert Toedt’s pension balance to LACERA. Under the circumstances, we will not issue an opinion addressing the hypothetical scope of the POA. (Selby Realty Co. v. City of San Buenaventura (1973) 10 Cal.3d 110, 117; People ex rel. Lynch v. Superior Court (1970) 1 Cal.3d 910, 912.)[6]

DISPOSITION

The judgment is affirmed. The parties shall bear their own costs on appeal.

NOT TO BE PUBLISHED

CRANDALL, J.*

We concur:

CHANEY, J.

BENDIX, Acting P. J.

[1] The record contains a document dated April 24, 2019, discussed post, entitled “Confirmation Notice,” seemingly summarizing the outcome of this meeting.

[2] Emerson’s argument below premised upon the Toedt sisters having had an “insurable interest” in Toedt’s pension has not been made on this appeal, and is therefore forfeited. (Tiernan v. Trustees of Cal. State University & Colleges (1982) 33 Cal.3d 211, 216, fn. 4.)

[3] Erickson and Tate had been previously named as beneficiaries of a revocable trust established by Toedt years prior to her decline.

[4] Subsequent undesignated statutory references are to the Probate Code. Section 4264, entitled “Acts requiring express authorization in power of attorney,” provides that “a power of attorney may perform any of the following acts on behalf of the principal or with the property of the principal only if the power of attorney expressly grants that authority to the attorney-in-fact,” (italics added) and subdivision (f) includes among those powers, the power to “[d]esignate or change the designation of beneficiaries to receive any property, benefit, or contract right on the principal’s death.” (§ 4264, subd. (f).) The Schubert court addressed whether a power of attorney that expressly grants the power to make a trust necessarily includes along with it the power to designate or remove beneficiaries, despite section 4264’s requirement that such a power be expressly designated. (Schubert, supra, 95 Cal.App.4th at pp. 103-104.) It harmonized the power of attorney before it with section 4264, subdivision (d), by holding that the attorney-in-fact was limited to choosing beneficiaries that were already contemplated by the decedent’s estate plan and/or the beneficiaries otherwise eligible under the rules of intestate succession. (Schubert, supra, at pp. 106-107.) The trial court and we agree Schubert is inapposite because unlike the present case—and as Emerson concedes—the POA does not confer upon Emerson the power to create a trust.

[5] Emerson does not take issue with the trial court’s rejection of his contract reformation and unjust enrichment arguments. These arguments are therefore deemed forfeited. (Tiernan v. Trustees of Cal. State University & Colleges, supra, 33 Cal.3d at p. 216, fn. 4)

[6] Emerson’s argument concerning prejudicial admission of the Popowich declaration was belatedly raised in the writ proceeding below and in a perfunctory fashion. Although we could deem the issue forfeited (Sea & Sage Audubon Society, Inc. v. Planning Com. (1983) 34 Cal.3d 412, 417), we note the trial court indicated that “[it] agreed with [Emerson] that the evidence of counseling lacked foundation.” Accordingly, we too will omit any substantive reliance upon the oral counseling Toedt may have received from LACERA staff.

* Judge of the San Luis Obispo County Superior Court, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.

Filed 2/25/22 Emerson v. Los Angeles County Employees etc. CA2/1

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION ONE

APPEAL from a judgment of the Superior Court of Los Angeles County, James C. Chalfant, Judge. Affirmed.

Peter Borenstein for Plaintiffs and Appellants.

Steven P. Rice and Michael D. Herrera for Defendant and Respondent.

________________________

By virtue of her former employment by Los Angeles County (County) as an emergency room nurse and, later, hospital administrator, Charla Toedt was a member of the Los Angeles County Employees Retirement Association (LACERA). She accrued nearly 30 years of service and planned to retire on June 26, 2019.

On May 6, 2019, Toedt finalized her retirement arrangements with LACERA, at which time she appeared to be in good health and expected to receive a monthly retirement income of more than $5,000 for the rest of her life. Toedt chose the maximum income stream for herself and did not name any beneficiaries. In fact, the plan in which she had participated for her entire career, Plan E, limits eligible beneficiaries to a surviving spouse, domestic partner, or minor children, and Toedt had no such beneficiaries.

On May 30, 2019, Toedt suffered a catastrophic stroke and became incapacitated.

On June 19, 2019, Toedt’s longtime friend and roommate, petitioner Bruce Emerson, contacted LACERA in the capacity of Toedt’s attorney-in-fact, citing a springing power of attorney (POA) which he had held on Toedt’s behalf since 2011, and attempted to amend her retirement plan to add Toedt’s sisters, petitioners Sarah Erickson, Mary Tate, and Jane Osumi (Toedt’s sisters, or the Toedt sisters) as beneficiaries.

On June 30, 2019, Toedt passed away after a short time in hospice.

When LACERA later refused to honor Emerson’s request to add the Toedt sisters as beneficiaries (collectively, Emerson or appellants), he and they filed a petition for a writ of mandate. Following a bench trial, the court ruled in favor of LACERA.

Appellants urge error in the trial court’s refusal to extend the holding of Schubert v. Reynolds (2002) 95 Cal.App.4th 100 (Schubert), which discusses circumstances under which a power of attorney can add or change beneficiaries to a public retirement plan, as well as the trial court’s erroneous reliance upon an inadmissible hearsay declaration in reaching its judgment.

Although the trial judge and the parties thoroughly explored whether the holding in Schubert aids Emerson, we need not reach this issue because appellants’ fundamental contention is that LACERA wrongfully refused to permit Emerson to change Toedt’s pension plan from Option 1 to Option 4 of Plan E. Option 4 of Plan E, identically to Option 1, limits eligible beneficiaries to a surviving spouse, domestic partner, or minor children. Toedt’s sisters are not among this class. As a result, regardless of Emerson’s powers to choose among options within Plan E, he has not demonstrated error because there is no path by which Toedt’s sisters would be eligible to obtain a continuing benefit.

Because it was inartfully and belatedly raised in the trial court, we also reject appellants’ hearsay objection to the entirety of the declaration submitted by John Popowich, assistant executive officer for LACERA. However, as did the trial court, we will exclude from our consideration any substantive discussions regarding oral counseling Toedt may have received from LACERA staff.

Accordingly, we affirm.

FACTUAL AND PROCEDURAL BACKGROUND

LACERA is a public retirement system created and governed by the County Employees Retirement Law of 1937 (Gov. Code, § 31450 et seq.) to provide retirement, disability and death benefits for eligible County employees. LACERA is a public entity legally separate and distinct from the County. (See Traub v. Board of Retirement (1983) 34 Cal.3d 793, 798-799.) The Board of Retirement of LACERA is charged with, among other things, administering the retirement system for eligible County employees. (Gov. Code, §§ 31520.1, 31520.5.)

LACERA administers several defined-benefit retirement plans, colloquially known as “Plan A” through “Plan G.” Every plan except Plan E—the plan in which Toedt was enrolled—is a “contributory” plan. Plan E members, on the other hand, do not make contributions: the payment of Plan E benefits is financed entirely by County contributions and the earnings of its retirement fund. Because Plan E members do not pay monthly contributions, Plan E benefits are lower than under the contributory retirement plans administered by LACERA.

Toedt was employed by the County from April 1992 until June 2019. By virtue of Toedt’s employment with the County, she was a member of LACERA. (Gov. Code, § 31552). Toedt participated in Plan E throughout her employment.

On October 31, 2018, April 24, 2019, and May 6, 2019, Toedt visited LACERA member services center for retirement counseling. During these counseling sessions, Toedt received retirement benefit estimates, discussed highest final average compensation, retirement benefit options, medical subsidy, healthcare plans, beneficiary designations and more.

During the April 24, 2019 counseling session, Toedt submitted a beneficiary designation form naming the Charla R. Toedt Trust (Trust) as beneficiary to receive a $5,000 lump sum “death/burial benefit.” On this same day, a beneficiary confirmation letter was printed and mailed by LACERA to Toedt.[1]

The Confirmation Notice letter has two columns: one entitled “% of Death Benefit,” the other entitled “% of Retiree Burial Benefit.” The number “100” is printed under both headings. In narrative form below these figures is printed: “The $5,000 Death/Burial Benefit is paid only if the member dies after retirement.” This Confirmation Notice nowhere discusses the beneficiary of any “continuing benefit,” i.e., a claim to a portion of a stream of income payable to a qualifying beneficiary following Toedt’s death.

At the time of Toedt’s retirement, Plan E included six retirement options. These options affect the amount of the member’s monthly retirement allowance during their lifetime, as well as the amount of continuing benefits payable to a spouse, domestic partner, or minor child upon the member’s death. No Plan E option expands the class of eligible beneficiaries to include a “trust” or a decedent’s siblings.

The “Unmodified” option, the option selected by Toedt, provides the full amount of the monthly benefit to which the member is entitled based on the member’s retirement plan, age, years of service, and final compensation. By comparison, the “Unmodified +Plus” option and “Option 1” through “Option 4” are customized benefit options that pay a member a reduced retirement benefit while also providing a fixed percentage or set dollar amount to the same class of eligible beneficiaries, i.e., a surviving spouse, domestic partner, or minor children.

The appellate record contains a handbook for Plan E members entitled, “Summary Plan Description/Retirement Plan E/General Member.” Under the section for “Designating Beneficiaries,” a subsection begins: “Eligible beneficiaries referenced in Plan E Retirement Options are defined on the following pages.” The following pages go on to list a surviving spouse, domestic partner, minor child, or person with an insurable interest.[2]

On May 6, 2019, Toedt again visited LACERA’s member services center to submit retirement documents. She elected a retirement date of June 26, 2019, and again chose the Unmodified option. The appellate record also contains a form, entitled “Retirement Benefit Estimate and Election Form (Counter Application),” stamped “Received[,] May 06, 2019[,] LACERA MEMBER SERVICE CENTER.” Under the column “Beneficiary’s Allowance,” the form is blank.

On June 7, 2019, after Toedt became incapacitated, Emerson visited LACERA’s member services center and submitted the POA, as well as a letter from Toedt’s doctor stating that she was unable to make financial or medical decisions due to her medical condition.

On June 11, 2019, following a legal review of the POA by LACERA’s in-house counsel, staff sent a letter acknowledging approval of Emerson as Toedt’s attorney-in-fact and explaining his limited powers with respect to making amendments to Toedt’s pension agreement with LACERA. This letter stated that Emerson was only authorized to: (1) file an application to retire and requests for estimates; (2) select the unmodified benefit option only; and (3) request to withdraw retirement contributions and interest.

On June 14, 2019, LACERA staff verbally informed Emerson that he was not able to change the member’s retirement option or name any beneficiaries because these actions were not expressly authorized by the POA.

On June 21, 2019, Emerson submitted a request to: (1) rescind Toedt’s retirement date of June 26, 2019; (2) retire Toedt on June 28, 2019; (3) change the retirement option from “Unmodified” to “Option 4”; and (4) add the Toedt sisters as beneficiaries.[3]

On June 30, 2019, Toedt passed away.

On July 5, 2019, LACERA staff verbally informed Emerson that it was rejecting his requests to change Toedt’s retirement option from Unmodified to Option 4 in order to add beneficiaries given the POA’s lack of express authority to make such changes.

On July 10, 2019, LACERA followed-up in writing and confirmed that his requests were rejected because Toedt’s POA does not expressly allow for the attorney-in-fact to “designate” or “change” her plan beneficiaries.

On September 19, 2019, Emerson filed a petition for writ of mandate and complaint for declaratory and injunctive relief. The petition sought a writ of mandate to compel LACERA to retroactively amend Toedt’s retirement plan in order to change from Unmodified to Option 4, and to add the Toedt sisters as beneficiaries.

On October 15, 2020, following a bench trial, the trial court issued a thorough 15-page, single-spaced, ruling in favor of LACERA, concluding that Emerson lacked the power to add or remove beneficiaries to Toedt’s pension under Probate Code section 4264,[4] and that Schubert’s limited exception to section 4264 was inapplicable because Emerson’s POA did itself not expressly confer upon Emerson the authority to create a trust in the first instance.

The trial court also rejected the argument that Toedt’s contract with LACERA should be equitably reformed to include the Toedt sisters as beneficiaries (despite Plan E’s exclusion of such persons) based upon LACERA’s failure to advise Toedt that the Trust was an ineligible beneficiary at the April 24, 2019, counseling session. And it similarly rejected Emerson’s argument that LACERA was unjustly enriched, instead ruling that, by electing the Unmodified option, Toedt received exactly what she had bargained for: the highest personal payout in a LACERA plan that had limited beneficiary options for a continuing benefit.

DISCUSSION

On appeal from a denial of a petition for a writ of mandate, we review the trial court’s factual findings for substantial evidence and its legal conclusions de novo. (McIntyre v. Santa Barbara County Employees’ Retirement System (2001) 91 Cal.App.4th 730, 733-734.)

Appealed judgments and orders are presumed correct, and the appellant has the burden of overcoming this presumption by affirmatively showing error on an adequate record. (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1140-1141; Stasz v. Eisenberg (2010) 190 Cal.App.4th 1032, 1039.) All intendments and presumptions are made to support the judgment or final order on matters as to which the record is silent. (Denham v. Superior Court (1970) 2 Cal.3d 557, 564; Cahill v. San Diego Gas & Electric Co. (2011) 194 Cal.App.4th 939, 956.) Any ambiguity in the record is resolved in favor of the appealed judgment. (Winograd v. American Broadcasting Co. (1998) 68 Cal.App.4th 624, 631.)

“ ‘We affirm the trial court’s decision if it is correct on any ground the parties had an adequate opportunity to address in the trial court, regardless of the reasons the trial court gave.’ [Citation.]” (Wolf v. Weber (2020) 52 Cal.App.5th 406, 410.)

Emerson’s briefing asserts two points of error: (1) that the Schubert exception to section 4264 applies to him, and he thus has the power to select beneficiaries to Toedt’s retirement plan; and (2) the trial court’s reliance on a declaration submitted by Popowich, was reversible error because the declaration is inadmissible hearsay.[5]

It is to be immediately noted that Emerson’s dispute with the trial court over its interpretation of Schubert and section 4264 does not alter the contractual relationships established between Toedt and LACERA. Even were we to rule that Emerson had the power by virtue of his POA to change Toedt’s pension from Unmodified to Option 4 of Plan E, it would not follow that he could also thereby select surviving siblings or a trust as continuing benefit beneficiaries. Put somewhat differently, Emerson’s purported general power to select Toedt’s pension beneficiaries would not confer a right to amend LACERA’s pension agreement with Toedt.

All Plan E options limit eligible beneficiaries to surviving spouses, domestic partners, and minor children. These beneficiary limitations are reflected in the Plan E summary material as well as the May 6, 2019 certificate that was issued following Toedt’s final interaction with the LACERA service center. Both the Plan E summary material as well as the May 6, 2019 certificate reflect Toedt’s knowledge that she had selected a retirement option providing no economic post-death value (excepting the $5,000 lump sum burial benefit) because she had no surviving spouse, domestic partner, or minor children.

Toedt was a Plan E retirement member throughout all her professional life with the County and that she made no retirement contributions out of her own salary and because all non-Plan E plans require salary contributions. Plan E members have six options to select from prior to retirement. The only options at issue in this case are Unmodified and Option 4. Toedt selected Unmodified on at least two occasions and did so in order to receive the highest possible individual post-retirement stream of income. The continuing benefit was limited to a surviving spouse, domestic partner, or minor child and capped at 55 percent of a “member’s allowance” for Unmodified members under the plan documents.

With Toedt critically ill, Emerson attempted to switch Toedt’s pension beneficiaries from Unmodified to Option 4, the latter of which is a “customized benefit option[ ] that pays a member a reduced retirement benefit and provides a fixed percentage or set dollar amount to one or more eligible beneficiaries.” But, as we have said, the eligible Option 4/Plan E beneficiaries are the same: a surviving spouse, domestic partner, or minor children. Moreover, lest there be any confusion about nominating a trust as a Plan E beneficiary, the plan document provides (in a section pertaining to all Plan E options): “If you have a trust and wish to leave a continuing monthly benefit to your spouse, you must designate the spouse as your Primary Beneficiary-100 percent and the trust as Secondary Beneficiary-100 percent. If your spouse or domestic partner dies before you and you have no eligible minor children, unless otherwise designated, the trust will receive a $5,000 lump-sum death/burial benefit. A trust cannot receive a continuing monthly benefit.” (Italics added.)

This limitation prohibiting a trust from receiving a continuing benefit makes sense because, were it otherwise, the LACERA member could easily avoid one of the retirement plan’s fundamental limitations on its survival benefit obligations, viz., only three classes of persons are eligible.

Our independent review of the record on this appeal shows no set of facts under which either Emerson or Toedt could have compelled LACERA to pay her continuing benefit to her sisters—or to anyone for that matter. And if such a pathway does exist, it was incumbent upon Emerson to furnish an adequate record to rebut the presumption that the challenged judgment is correct (Ketchum v. Moses, supra, 24 Cal.4th at pp. 1140-1141; Stasz v. Eisenberg, supra, 190 Cal.App.4th at p. 1039), and to affirmatively demonstrate how the Toedt sisters would be eligible to receive a continuing benefit under any Plan E option. Emerson has not done so, and we cannot speculate in his favor.

Relatedly, reversal of the trial court’s judgment on the POA issue would serve no useful purpose: LACERA would still be entitled to reject Emerson’s beneficiary selection, and the absence of any eligible beneficiaries would revert Toedt’s pension balance to LACERA. Under the circumstances, we will not issue an opinion addressing the hypothetical scope of the POA. (Selby Realty Co. v. City of San Buenaventura (1973) 10 Cal.3d 110, 117; People ex rel. Lynch v. Superior Court (1970) 1 Cal.3d 910, 912.)[6]

DISPOSITION

The judgment is affirmed. The parties shall bear their own costs on appeal.

NOT TO BE PUBLISHED

CRANDALL, J.*

We concur:

CHANEY, J.

BENDIX, Acting P. J.

[1] The record contains a document dated April 24, 2019, discussed post, entitled “Confirmation Notice,” seemingly summarizing the outcome of this meeting.

[2] Emerson’s argument below premised upon the Toedt sisters having had an “insurable interest” in Toedt’s pension has not been made on this appeal, and is therefore forfeited. (Tiernan v. Trustees of Cal. State University & Colleges (1982) 33 Cal.3d 211, 216, fn. 4.)

[3] Erickson and Tate had been previously named as beneficiaries of a revocable trust established by Toedt years prior to her decline.

[4] Subsequent undesignated statutory references are to the Probate Code. Section 4264, entitled “Acts requiring express authorization in power of attorney,” provides that “a power of attorney may perform any of the following acts on behalf of the principal or with the property of the principal only if the power of attorney expressly grants that authority to the attorney-in-fact,” (italics added) and subdivision (f) includes among those powers, the power to “[d]esignate or change the designation of beneficiaries to receive any property, benefit, or contract right on the principal’s death.” (§ 4264, subd. (f).) The Schubert court addressed whether a power of attorney that expressly grants the power to make a trust necessarily includes along with it the power to designate or remove beneficiaries, despite section 4264’s requirement that such a power be expressly designated. (Schubert, supra, 95 Cal.App.4th at pp. 103-104.) It harmonized the power of attorney before it with section 4264, subdivision (d), by holding that the attorney-in-fact was limited to choosing beneficiaries that were already contemplated by the decedent’s estate plan and/or the beneficiaries otherwise eligible under the rules of intestate succession. (Schubert, supra, at pp. 106-107.) The trial court and we agree Schubert is inapposite because unlike the present case—and as Emerson concedes—the POA does not confer upon Emerson the power to create a trust.

[5] Emerson does not take issue with the trial court’s rejection of his contract reformation and unjust enrichment arguments. These arguments are therefore deemed forfeited. (Tiernan v. Trustees of Cal. State University & Colleges, supra, 33 Cal.3d at p. 216, fn. 4)

[6] Emerson’s argument concerning prejudicial admission of the Popowich declaration was belatedly raised in the writ proceeding below and in a perfunctory fashion. Although we could deem the issue forfeited (Sea & Sage Audubon Society, Inc. v. Planning Com. (1983) 34 Cal.3d 412, 417), we note the trial court indicated that “[it] agreed with [Emerson] that the evidence of counseling lacked foundation.” Accordingly, we too will omit any substantive reliance upon the oral counseling Toedt may have received from LACERA staff.

* Judge of the San Luis Obispo County Superior Court, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.

Filed 2/25/22 Emerson v. Los Angeles County Employees etc. CA2/1

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION ONE

APPEAL from a judgment of the Superior Court of Los Angeles County, James C. Chalfant, Judge. Affirmed.

Peter Borenstein for Plaintiffs and Appellants.

Steven P. Rice and Michael D. Herrera for Defendant and Respondent.

________________________

By virtue of her former employment by Los Angeles County (County) as an emergency room nurse and, later, hospital administrator, Charla Toedt was a member of the Los Angeles County Employees Retirement Association (LACERA). She accrued nearly 30 years of service and planned to retire on June 26, 2019.

On May 6, 2019, Toedt finalized her retirement arrangements with LACERA, at which time she appeared to be in good health and expected to receive a monthly retirement income of more than $5,000 for the rest of her life. Toedt chose the maximum income stream for herself and did not name any beneficiaries. In fact, the plan in which she had participated for her entire career, Plan E, limits eligible beneficiaries to a surviving spouse, domestic partner, or minor children, and Toedt had no such beneficiaries.

On May 30, 2019, Toedt suffered a catastrophic stroke and became incapacitated.

On June 19, 2019, Toedt’s longtime friend and roommate, petitioner Bruce Emerson, contacted LACERA in the capacity of Toedt’s attorney-in-fact, citing a springing power of attorney (POA) which he had held on Toedt’s behalf since 2011, and attempted to amend her retirement plan to add Toedt’s sisters, petitioners Sarah Erickson, Mary Tate, and Jane Osumi (Toedt’s sisters, or the Toedt sisters) as beneficiaries.

On June 30, 2019, Toedt passed away after a short time in hospice.

When LACERA later refused to honor Emerson’s request to add the Toedt sisters as beneficiaries (collectively, Emerson or appellants), he and they filed a petition for a writ of mandate. Following a bench trial, the court ruled in favor of LACERA.

Appellants urge error in the trial court’s refusal to extend the holding of Schubert v. Reynolds (2002) 95 Cal.App.4th 100 (Schubert), which discusses circumstances under which a power of attorney can add or change beneficiaries to a public retirement plan, as well as the trial court’s erroneous reliance upon an inadmissible hearsay declaration in reaching its judgment.

Although the trial judge and the parties thoroughly explored whether the holding in Schubert aids Emerson, we need not reach this issue because appellants’ fundamental contention is that LACERA wrongfully refused to permit Emerson to change Toedt’s pension plan from Option 1 to Option 4 of Plan E. Option 4 of Plan E, identically to Option 1, limits eligible beneficiaries to a surviving spouse, domestic partner, or minor children. Toedt’s sisters are not among this class. As a result, regardless of Emerson’s powers to choose among options within Plan E, he has not demonstrated error because there is no path by which Toedt’s sisters would be eligible to obtain a continuing benefit.

Because it was inartfully and belatedly raised in the trial court, we also reject appellants’ hearsay objection to the entirety of the declaration submitted by John Popowich, assistant executive officer for LACERA. However, as did the trial court, we will exclude from our consideration any substantive discussions regarding oral counseling Toedt may have received from LACERA staff.

Accordingly, we affirm.

FACTUAL AND PROCEDURAL BACKGROUND

LACERA is a public retirement system created and governed by the County Employees Retirement Law of 1937 (Gov. Code, § 31450 et seq.) to provide retirement, disability and death benefits for eligible County employees. LACERA is a public entity legally separate and distinct from the County. (See Traub v. Board of Retirement (1983) 34 Cal.3d 793, 798-799.) The Board of Retirement of LACERA is charged with, among other things, administering the retirement system for eligible County employees. (Gov. Code, §§ 31520.1, 31520.5.)

LACERA administers several defined-benefit retirement plans, colloquially known as “Plan A” through “Plan G.” Every plan except Plan E—the plan in which Toedt was enrolled—is a “contributory” plan. Plan E members, on the other hand, do not make contributions: the payment of Plan E benefits is financed entirely by County contributions and the earnings of its retirement fund. Because Plan E members do not pay monthly contributions, Plan E benefits are lower than under the contributory retirement plans administered by LACERA.

Toedt was employed by the County from April 1992 until June 2019. By virtue of Toedt’s employment with the County, she was a member of LACERA. (Gov. Code, § 31552). Toedt participated in Plan E throughout her employment.

On October 31, 2018, April 24, 2019, and May 6, 2019, Toedt visited LACERA member services center for retirement counseling. During these counseling sessions, Toedt received retirement benefit estimates, discussed highest final average compensation, retirement benefit options, medical subsidy, healthcare plans, beneficiary designations and more.

During the April 24, 2019 counseling session, Toedt submitted a beneficiary designation form naming the Charla R. Toedt Trust (Trust) as beneficiary to receive a $5,000 lump sum “death/burial benefit.” On this same day, a beneficiary confirmation letter was printed and mailed by LACERA to Toedt.[1]

The Confirmation Notice letter has two columns: one entitled “% of Death Benefit,” the other entitled “% of Retiree Burial Benefit.” The number “100” is printed under both headings. In narrative form below these figures is printed: “The $5,000 Death/Burial Benefit is paid only if the member dies after retirement.” This Confirmation Notice nowhere discusses the beneficiary of any “continuing benefit,” i.e., a claim to a portion of a stream of income payable to a qualifying beneficiary following Toedt’s death.

At the time of Toedt’s retirement, Plan E included six retirement options. These options affect the amount of the member’s monthly retirement allowance during their lifetime, as well as the amount of continuing benefits payable to a spouse, domestic partner, or minor child upon the member’s death. No Plan E option expands the class of eligible beneficiaries to include a “trust” or a decedent’s siblings.

The “Unmodified” option, the option selected by Toedt, provides the full amount of the monthly benefit to which the member is entitled based on the member’s retirement plan, age, years of service, and final compensation. By comparison, the “Unmodified +Plus” option and “Option 1” through “Option 4” are customized benefit options that pay a member a reduced retirement benefit while also providing a fixed percentage or set dollar amount to the same class of eligible beneficiaries, i.e., a surviving spouse, domestic partner, or minor children.

The appellate record contains a handbook for Plan E members entitled, “Summary Plan Description/Retirement Plan E/General Member.” Under the section for “Designating Beneficiaries,” a subsection begins: “Eligible beneficiaries referenced in Plan E Retirement Options are defined on the following pages.” The following pages go on to list a surviving spouse, domestic partner, minor child, or person with an insurable interest.[2]

On May 6, 2019, Toedt again visited LACERA’s member services center to submit retirement documents. She elected a retirement date of June 26, 2019, and again chose the Unmodified option. The appellate record also contains a form, entitled “Retirement Benefit Estimate and Election Form (Counter Application),” stamped “Received[,] May 06, 2019[,] LACERA MEMBER SERVICE CENTER.” Under the column “Beneficiary’s Allowance,” the form is blank.

On June 7, 2019, after Toedt became incapacitated, Emerson visited LACERA’s member services center and submitted the POA, as well as a letter from Toedt’s doctor stating that she was unable to make financial or medical decisions due to her medical condition.

On June 11, 2019, following a legal review of the POA by LACERA’s in-house counsel, staff sent a letter acknowledging approval of Emerson as Toedt’s attorney-in-fact and explaining his limited powers with respect to making amendments to Toedt’s pension agreement with LACERA. This letter stated that Emerson was only authorized to: (1) file an application to retire and requests for estimates; (2) select the unmodified benefit option only; and (3) request to withdraw retirement contributions and interest.

On June 14, 2019, LACERA staff verbally informed Emerson that he was not able to change the member’s retirement option or name any beneficiaries because these actions were not expressly authorized by the POA.

On June 21, 2019, Emerson submitted a request to: (1) rescind Toedt’s retirement date of June 26, 2019; (2) retire Toedt on June 28, 2019; (3) change the retirement option from “Unmodified” to “Option 4”; and (4) add the Toedt sisters as beneficiaries.[3]

On June 30, 2019, Toedt passed away.

On July 5, 2019, LACERA staff verbally informed Emerson that it was rejecting his requests to change Toedt’s retirement option from Unmodified to Option 4 in order to add beneficiaries given the POA’s lack of express authority to make such changes.

On July 10, 2019, LACERA followed-up in writing and confirmed that his requests were rejected because Toedt’s POA does not expressly allow for the attorney-in-fact to “designate” or “change” her plan beneficiaries.

On September 19, 2019, Emerson filed a petition for writ of mandate and complaint for declaratory and injunctive relief. The petition sought a writ of mandate to compel LACERA to retroactively amend Toedt’s retirement plan in order to change from Unmodified to Option 4, and to add the Toedt sisters as beneficiaries.

On October 15, 2020, following a bench trial, the trial court issued a thorough 15-page, single-spaced, ruling in favor of LACERA, concluding that Emerson lacked the power to add or remove beneficiaries to Toedt’s pension under Probate Code section 4264,[4] and that Schubert’s limited exception to section 4264 was inapplicable because Emerson’s POA did itself not expressly confer upon Emerson the authority to create a trust in the first instance.

The trial court also rejected the argument that Toedt’s contract with LACERA should be equitably reformed to include the Toedt sisters as beneficiaries (despite Plan E’s exclusion of such persons) based upon LACERA’s failure to advise Toedt that the Trust was an ineligible beneficiary at the April 24, 2019, counseling session. And it similarly rejected Emerson’s argument that LACERA was unjustly enriched, instead ruling that, by electing the Unmodified option, Toedt received exactly what she had bargained for: the highest personal payout in a LACERA plan that had limited beneficiary options for a continuing benefit.

DISCUSSION

On appeal from a denial of a petition for a writ of mandate, we review the trial court’s factual findings for substantial evidence and its legal conclusions de novo. (McIntyre v. Santa Barbara County Employees’ Retirement System (2001) 91 Cal.App.4th 730, 733-734.)

Appealed judgments and orders are presumed correct, and the appellant has the burden of overcoming this presumption by affirmatively showing error on an adequate record. (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1140-1141; Stasz v. Eisenberg (2010) 190 Cal.App.4th 1032, 1039.) All intendments and presumptions are made to support the judgment or final order on matters as to which the record is silent. (Denham v. Superior Court (1970) 2 Cal.3d 557, 564; Cahill v. San Diego Gas & Electric Co. (2011) 194 Cal.App.4th 939, 956.) Any ambiguity in the record is resolved in favor of the appealed judgment. (Winograd v. American Broadcasting Co. (1998) 68 Cal.App.4th 624, 631.)

“ ‘We affirm the trial court’s decision if it is correct on any ground the parties had an adequate opportunity to address in the trial court, regardless of the reasons the trial court gave.’ [Citation.]” (Wolf v. Weber (2020) 52 Cal.App.5th 406, 410.)

Emerson’s briefing asserts two points of error: (1) that the Schubert exception to section 4264 applies to him, and he thus has the power to select beneficiaries to Toedt’s retirement plan; and (2) the trial court’s reliance on a declaration submitted by Popowich, was reversible error because the declaration is inadmissible hearsay.[5]

It is to be immediately noted that Emerson’s dispute with the trial court over its interpretation of Schubert and section 4264 does not alter the contractual relationships established between Toedt and LACERA. Even were we to rule that Emerson had the power by virtue of his POA to change Toedt’s pension from Unmodified to Option 4 of Plan E, it would not follow that he could also thereby select surviving siblings or a trust as continuing benefit beneficiaries. Put somewhat differently, Emerson’s purported general power to select Toedt’s pension beneficiaries would not confer a right to amend LACERA’s pension agreement with Toedt.

All Plan E options limit eligible beneficiaries to surviving spouses, domestic partners, and minor children. These beneficiary limitations are reflected in the Plan E summary material as well as the May 6, 2019 certificate that was issued following Toedt’s final interaction with the LACERA service center. Both the Plan E summary material as well as the May 6, 2019 certificate reflect Toedt’s knowledge that she had selected a retirement option providing no economic post-death value (excepting the $5,000 lump sum burial benefit) because she had no surviving spouse, domestic partner, or minor children.

Toedt was a Plan E retirement member throughout all her professional life with the County and that she made no retirement contributions out of her own salary and because all non-Plan E plans require salary contributions. Plan E members have six options to select from prior to retirement. The only options at issue in this case are Unmodified and Option 4. Toedt selected Unmodified on at least two occasions and did so in order to receive the highest possible individual post-retirement stream of income. The continuing benefit was limited to a surviving spouse, domestic partner, or minor child and capped at 55 percent of a “member’s allowance” for Unmodified members under the plan documents.

With Toedt critically ill, Emerson attempted to switch Toedt’s pension beneficiaries from Unmodified to Option 4, the latter of which is a “customized benefit option[ ] that pays a member a reduced retirement benefit and provides a fixed percentage or set dollar amount to one or more eligible beneficiaries.” But, as we have said, the eligible Option 4/Plan E beneficiaries are the same: a surviving spouse, domestic partner, or minor children. Moreover, lest there be any confusion about nominating a trust as a Plan E beneficiary, the plan document provides (in a section pertaining to all Plan E options): “If you have a trust and wish to leave a continuing monthly benefit to your spouse, you must designate the spouse as your Primary Beneficiary-100 percent and the trust as Secondary Beneficiary-100 percent. If your spouse or domestic partner dies before you and you have no eligible minor children, unless otherwise designated, the trust will receive a $5,000 lump-sum death/burial benefit. A trust cannot receive a continuing monthly benefit.” (Italics added.)

This limitation prohibiting a trust from receiving a continuing benefit makes sense because, were it otherwise, the LACERA member could easily avoid one of the retirement plan’s fundamental limitations on its survival benefit obligations, viz., only three classes of persons are eligible.

Our independent review of the record on this appeal shows no set of facts under which either Emerson or Toedt could have compelled LACERA to pay her continuing benefit to her sisters—or to anyone for that matter. And if such a pathway does exist, it was incumbent upon Emerson to furnish an adequate record to rebut the presumption that the challenged judgment is correct (Ketchum v. Moses, supra, 24 Cal.4th at pp. 1140-1141; Stasz v. Eisenberg, supra, 190 Cal.App.4th at p. 1039), and to affirmatively demonstrate how the Toedt sisters would be eligible to receive a continuing benefit under any Plan E option. Emerson has not done so, and we cannot speculate in his favor.

Relatedly, reversal of the trial court’s judgment on the POA issue would serve no useful purpose: LACERA would still be entitled to reject Emerson’s beneficiary selection, and the absence of any eligible beneficiaries would revert Toedt’s pension balance to LACERA. Under the circumstances, we will not issue an opinion addressing the hypothetical scope of the POA. (Selby Realty Co. v. City of San Buenaventura (1973) 10 Cal.3d 110, 117; People ex rel. Lynch v. Superior Court (1970) 1 Cal.3d 910, 912.)[6]

DISPOSITION

The judgment is affirmed. The parties shall bear their own costs on appeal.

NOT TO BE PUBLISHED

CRANDALL, J.*

We concur:

CHANEY, J.

BENDIX, Acting P. J.

[1] The record contains a document dated April 24, 2019, discussed post, entitled “Confirmation Notice,” seemingly summarizing the outcome of this meeting.

[2] Emerson’s argument below premised upon the Toedt sisters having had an “insurable interest” in Toedt’s pension has not been made on this appeal, and is therefore forfeited. (Tiernan v. Trustees of Cal. State University & Colleges (1982) 33 Cal.3d 211, 216, fn. 4.)

[3] Erickson and Tate had been previously named as beneficiaries of a revocable trust established by Toedt years prior to her decline.

[4] Subsequent undesignated statutory references are to the Probate Code. Section 4264, entitled “Acts requiring express authorization in power of attorney,” provides that “a power of attorney may perform any of the following acts on behalf of the principal or with the property of the principal only if the power of attorney expressly grants that authority to the attorney-in-fact,” (italics added) and subdivision (f) includes among those powers, the power to “[d]esignate or change the designation of beneficiaries to receive any property, benefit, or contract right on the principal’s death.” (§ 4264, subd. (f).) The Schubert court addressed whether a power of attorney that expressly grants the power to make a trust necessarily includes along with it the power to designate or remove beneficiaries, despite section 4264’s requirement that such a power be expressly designated. (Schubert, supra, 95 Cal.App.4th at pp. 103-104.) It harmonized the power of attorney before it with section 4264, subdivision (d), by holding that the attorney-in-fact was limited to choosing beneficiaries that were already contemplated by the decedent’s estate plan and/or the beneficiaries otherwise eligible under the rules of intestate succession. (Schubert, supra, at pp. 106-107.) The trial court and we agree Schubert is inapposite because unlike the present case—and as Emerson concedes—the POA does not confer upon Emerson the power to create a trust.

[5] Emerson does not take issue with the trial court’s rejection of his contract reformation and unjust enrichment arguments. These arguments are therefore deemed forfeited. (Tiernan v. Trustees of Cal. State University & Colleges, supra, 33 Cal.3d at p. 216, fn. 4)

[6] Emerson’s argument concerning prejudicial admission of the Popowich declaration was belatedly raised in the writ proceeding below and in a perfunctory fashion. Although we could deem the issue forfeited (Sea & Sage Audubon Society, Inc. v. Planning Com. (1983) 34 Cal.3d 412, 417), we note the trial court indicated that “[it] agreed with [Emerson] that the evidence of counseling lacked foundation.” Accordingly, we too will omit any substantive reliance upon the oral counseling Toedt may have received from LACERA staff.

* Judge of the San Luis Obispo County Superior Court, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.